Council members assail BGE billing

City faults utility for charging budget customers before higher rates take effect

Maryland

April 20, 2006|By JOHN FRITZE | JOHN FRITZE,SUN REPORTER

Wrestling with an issue that they have virtually no control over, Baltimore City Council members took BGE to task yesterday over the utility's decision to implement rate increases for its budget-billing customers months before they are scheduled to affect other ratepayers.

Irate council members -- echoing a criticism made earlier in the day by Mayor Martin O'Malley's administration -- argued that the company is charging its most vulnerable customers the higher rates prematurely. Councilman James B. Kraft demanded that the money be returned.

"A lot of our constituents, if they pay $10 extra it's not just lunch money," Kraft said. "Ten dollars extra may be the difference between them being able to afford getting back and forth to work."

Budget-billing plans allow about 300,000 BGE customers to spread out the high cost of power during the winter months over the entire year. State officials ruled this year that BGE could start charging budget-billing customers based on the pending 72 percent rate increase now, rather than waiting for rate caps to expire this summer.

BGE officials responded by saying the customers can opt out of the program if they choose and said that those who do not will receive a refund if electricity bills do not rise as drastically as the company has projected.

"Customers absolutely love budget billing," said Wayne Harbaugh, BGE's manager for pricing and regulatory services. "Budget-billing customers will not be impacted by this."

City Solicitor Ralph S. Tyler tried to argue before the Public Service Commission yesterday that all Baltimore residents who use BGE's budget-billing service should be exempt from paying the higher electric rates until July 1. He was not allowed to make his case because the matter was not before the commission yesterday.

The proposed rate increases became a major point of contention in this year's legislative session, but leaders ultimately failed to approve a moratorium. Now, Gov. Robert L. Ehrlich Jr. and BGE officials are negotiating a way to soften the impact, by phasing in the increases.

The hearings came a day before O'Malley's campaign for governor was scheduled to roll out a plan to deal with the rate increases -- a plan the mayor suggested earlier this week might include re-regulating some electricity customers.

"This may have a dramatic impact on senior citizens [and] on people on fixed incomes," said Council President Sheila Dixon, who organized the council meeting to discuss the issue yesterday. "This is going to have a dramatic effect on people's lives."